The Emerging Cuban Upper-Middle Class

The average government paid Cuban worker still owns an average under US$20 a month but with Raul Castro and Obama easing restrictions on the island a new class of Cuban upper-middle class is beginning to emerge.

The Government Controlled Economy in Cuba

Cubans are both much poorer and much richer at the same time than we are as Americans. They enjoy absolutely free, very high quality healthcare and education, They also have their housing provided for them though there are problems and frustrations inherent in the Cuban government's regulation of this system but, this is not the blog entry to talk about that.

Cubans also receive some food subsidy so that there is almost no expense involved with meeting their most basic needs but, if you work for the government in Cuba, and almost every Cuban still does, then you are earning on average a little less than US$20 per month which does not add up to much disposable income.

Historically only a few privileged professions enjoyed any significant disposable income. These include:

military officials

state company bosses

tourism workers

artists

But, with the easing of regulations on the economy (or the lessening of the grip on power that the revolutionary government can exert, depending on who you are asking) more and more Cubans have access to the kind of opportunities a freer market space is bringing.

Growth in the Tourism Sector

The most obvious growth is coming to Cuba's tourism sector. As regulations by both the Cuban and US governments loosen more and more relatively wealthy Americans are visiting the island. To give you an idea of just how large an impact this could have on the island of Cuba picture this...

Canadians traveled to Cuba to the tune of 1.2 million tourists in 2015 while mostly US restrictions kept American traveler numbers down around 150,000. Canada has a population around 35 million. The population of the US is almost 320 million. If Americans start traveling to Cuba at the rate that Canadians do relative to their population that would mean an additional 10 million wealthy Western visitors to the island!

This growth in opportunity around tourism and other service industries is nowhere more apparent than on the ground in Cuba and is influencing the career paths, and life choices, of more and more Cubans every day and a new class of entrepreneur is sprouting to cater to both tourists and Cubans with new found disposable income alike.

The Double Edged Sword of the Freer Market Cuban Economy

While the arrival of more and more opportunity the ordinary Cuban is both empowered and exposed to more risk. Yes, there is a class of Cuban that is growing richer than could even be dreamed possible just a decade ago but, wealth in a communist (or socialist to Cubans) country still carries a stigma that threatens Cubans solidarity.

It is this solidarity in the face of hardship that has made them one of the most integrated and least discriminatory populations on Earth and helped them band together in the face of extreme adversity. Any wealth gap tends to breed distrust and resentment and would seem to threaten the very real value of the solidarity among the people.

And that isn't the only value threatened. The other less than tangible benefit of the relative poverty of the average Cuban is the interest in and adherence to a very high degree of education and academic achievement. Cubans are one of the most well educated populations on Earth as well and more and more the young student sees the immediate economic benefit of an unskilled job in tourism and is making the leap from the classroom to the barroom or some other outlet of the tourism trade.

Finding Economic and Social Balance

Cuba has some serious challenges ahead if they are going to modernize and open their economy and society to Western wealth and thereby, influence. As the people see the opportunities of the free market for the first time in generations and a society whose defining characteristics has always included solidarity becomes stratified it will be difficult to find a new balance that at once embraces change and preserves their unique virtues.

But, the Cuban people are a resilient one and have overcome so much in their storied socio-political past. If any can step out of the past and into the opportunity and exposure of the free market world without losing their identity or letting go of their virtues then it is the Cuban people.